Life Insurance Basics: How Life Insurance Works

Whether you have a family, a business, or others who depend on you, you already know how important it is to have some financial protection for them. Life insurance is a smart choice – but that doesn’t mean that it is simple. If you want to understand how life insurance works, the first thing you need to learn about are the many different types of life insurance. This blog is going back to the basics – giving you the information you need to make the right decision regarding that financial protection for your loved ones. 

There are three basic types of life insurance – term life insurance, whole life insurance and universal life insurance. 

Term life insurance is the most affordable life insurance product available. It is based on your wants and future goals. The length of the policy is chosen by you, usually from 10-30 years, and over the course of your policy your premiums remain the same. The amount of the policy is also determined by you, based on your budget and what you can afford each month. When the policy ends, you can choose to renew it or let it end.

Whole life insurance is more expensive than term life insurance but this is because it covers you for your entire life, rather than a pre-determined period of time – you are always protected. That doesn’t mean however that you are locked in – whole life insurance is flexible, and you can change the policy if needed as time passes. Your premiums do not change over the course of the policy, and as you pay into the policy, that money gains value which you can cash out or borrow against in the future.

Universal life insurance is a type of life insurance that many individuals use as an investment tool as it carries tax incentives. As you contribute to your policy through monthly premiums, that money grows and gains in value, while also keeping you protected. Additionally, universal life insurance is protected from creditors and probate, meaning no stress for your loved ones in the future.

The type of life insurance you choose will depend on your personal circumstances and both short and long term personal and financial goals. Once you determine the type of life insurance you need, next you will have to consider the type and length of the policy.

Now that you know how life insurance works, your next step is to look at getting some quotes. When it comes to getting quotes on life insurance it is important to strike the right balance between cost and benefits. The best thing to do is to speak with an insurance advisor – speaking with an insurance agent who works for an MGA and not for a specific insurance company will enable you to learn what all insurance companies are able to offer. 

Once you have decided on and purchased a policy, as long as you pay your monthly premiums, you are protected for the length of the policy. If necessary, you will need to renew the policy or depending on the policy, change it as your needs change. In the event of your death, your loved ones (those listed as beneficiaries) will receive the money held within the policy.

To get started on protection for the future, to find out about the different types of insurance or to learn more about how life insurance works, please contact Independent Financial Concepts Group at 416-849-1653.

Protection That Lasts: Long Term Care Insurance

Life insurance at any age is important, but the older we get, having the right coverage grows in importance. Financial protection for later-life health concerns gets increasingly significant as time passes, and so making sure that you have plans in place to help you cover these expenses is crucial. The best way to ensure that you will not suffer from a lack of financial security as health issues arise later in life is through long term care insurance.

What is long term care insurance? Long term care insurance is a type of insurance product which protects you in the event that you require medical care or assistance later in life.  This assistance may include: in-home nursing care, rehabilitation or therapy, personal care or in-home services such as cooking and cleaning, or having another person there to watch over you and help you when needed.

Maintaining your independence is an important part of the aging process, and with long term care insurance you can be sure that this independence remains intact. If you suffer from an illness or medical condition that necessitates assistance, being able to manage it on your own is vital. Long term care assures that you do not become dependent on your family members and instead can use the money from your long term care insurance to pay for the services you want or need. The money may also be used to move into a long term care facility, thereby giving you the freedom and flexibility to keep your independence.

Long term care insurance benefits become payable when you become unable to perform two or more daily activities because of a decline in either a mental or physical capacity. These tasks include things like bathing and dressing, transferring (ex. from the bed or a chair) or feeding.  If you require assistance with these tasks, your long term care insurance policy can cover the costs.

As with any insurance product, long term life insurance plans differ, both depending on the insurance provider and based upon your own wants/needs. These differences may include the amount of coverage or the length of that coverage. In order to ensure that your individual plan is best suited to you, the best route to take when researching plans is to speak with an experienced insurance advisor. They will be able to walk you through all of the different benefits and plan options to make sure that you are granted the best protection to last.

For more information about long term care insurance and how it will protect you in the future, please contact Independent Financial Concepts Group by calling 416-849-1653 or visit us online at www.wecoveryou.ca  

Diversity – A Managing General Agent’s Key to Your Success

In today’s insurance industry, being able to offer the best service to your clients is a crucial factor on your path to success. Diversity is a major part of this – so make sure that as an insurance advisor you are able to offer a diverse service. Working with a managing general agent is the best way to do this. The flexibility this offers, as well as the chance to work with a plethora of companies (rather than just one), will equal big gains.  

Diversity means the ability to access a wide range of insurance companies and offer a wide range of products to your clients. It is not difficult at all for a potential customer to head online and find a quote for insurance. So many customers, even after hearing about the ‘best price’ your company can offer, may jump online and compare. If your company’s best deal can be beaten, what is stopping that customer from choosing the competition? Nothing.

Working with a managing general agent gives you the flexibility to find clients the best insurance that meets their needs effectively. Clients that know that you are obtaining quotes for them, considering all insurance companies, are less likely to feel the need to jump online to shop around as they will be getting all the information that they need in one place.

While many consumers buy insurance based on price, price should not be the only deciding factor, so it is critical to be able to run through a variety of difference policies, explaining the benefits of each in order to help them make the most appropriate decision. It also pays to be able to work through the wealth of companies that your managing general agent works with to find your client the most suitable policy for the best price.

Diversity also means being able to offer a wide array of products. If your insurance company only offers one type of insurance, how can you attract those individuals looking for something different? You can’t. And what about returning clients looking to expand their portfolio? Many people will not go with a company that cannot offer everything that they need, or will need, and will switch if they find a company that can.

Working with a managing general agent gives you the power to offer a suite of services and products. Insurance, investments, etc. garner great end results for you – and mean customer retention. If your clients return to you for a new product and you are able to offer it to them, this means more money in your pocket and perhaps even more business in the future.

Working with an insurance company guarantees that company’s ability to make money – but not necessarily yours. Diversification comes with the power to work outside the box – something that you cannot do as an agent at an insurance company. Instead, join a managing general agency and see your success realized.

For more information about how diversification = big results, or why a managing general agent is the way to go, please contact Independent Financial Concepts Group by calling 905 849 1653.